“Quite honestly, we were wrong. We underestimated the passion the consumer had for this. We missed it. We shouldn’t have taken it away. We’re bringing it back.”
These are Keurig CEO Brian Kelley’s words to market analysts last week, when he admitted it was a mistake to discontinue the “My K-Cup,” thereby preventing consumers from having a wider range of coffee options.
Unfortunately the coffee machine manufacturer learned its lesson the hard way by not listening to the Voice of the Customer. Sales of Keurig machines and accessories dropped by 23 percent last quarter, resulting in a 10 percent fall in stock price. Now that the company has announced its plans to begin selling the product again, it still might be too late to win back a significant portion of their customer base.
This crisis could have been easily averted if Keurig had conducted a sentiment analysis on customer feedback. Data from social media, surveys, review sites, inbound emails, the call center and many other sources would have likely produced a spike in negative sentiment about the discontinuation of the My K-Cup product. Armed with these insights, the Keurig product team would have been able to address the issue sooner, resulting in a less severe loss of sales. Better yet, an early sentiment analysis would have likely revealed a positive sentiment about the My K-Cup product, and Keurig would not have decided to discontinue it. In this scenario, the situation would have been avoided entirely.
This implications of this blunder extend far beyond a quarter’s revenue loss and sinking stock price. The brand’s reputation is now damaged, as consumers see the discontinuation of the My K-Cup product as a way of forcing them to buy the more expensive alternative. When Keurig’s Facebook page exploded with negative comments, the company explained that using the My K-Cup with the new brewing technology represented a “safety concern” for consumers. Of course this explanation was not well-received and the brand damage seems irreversible at this point.
One of our clients in the small appliance manufacturing industry listens to customer feedback across a variety of channels (particularly social media) to inform product decisions. They even use this data to help determine what products to acquire. About 18 months ago, this business was strongly considering purchasing a seemingly popular and very trendy kitchen appliance. But after conducting a sentiment analysis with the Clarabridge platform, the company decided against making the purchase, as customer sentiment for that item was declining. Potential disaster averted.
We all cringe when we see a massive customer experience gaffe like Keurig’s and hope it never happens within our organization. But by always listening carefully to all sources of customer feedback, we can greatly reduce the risk of an un-informed product decision, and drink our morning coffee more peacefully.